Can you guess what percentage of people have $500,000 saved for retirement? Surprisingly, it’s probably less than you think

Dreaming of a comfortable retirement is something most Americans share. But how much money do you need to make these golden years truly golden? According to a recent Northwestern Mutual survey, the average person thinks they will need US$1.46 million. This is a very robust beam! While a million dollars has long been the retirement savings goal, the truth is that many people are starting from scratch. But what about those who have saved a substantial portion of their change? Let’s talk about the $500,000 club.

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Believe it or not, according to the 2022 Survey of Consumer Finances, only 9% of American families have saved half a million dollars or more for retirement. That’s right, less than one in 10 families has reached this milestone. It’s an impressive feat, but it also highlights the challenges many people face.

• According to the survey results, 46% of households have some type of retirement savings.

• 26% reported having $100,000 or more in their nest egg.

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Saving $500,000 may seem like a lot of money, but will it fund a comfortable retirement? The popular 4% rule suggests you can withdraw 4% of your savings annually without depleting your nest egg. For a $500,000 nest egg, that equates to $20,000 a year. Sure, it might cover some expenses, but it’s unlikely to maintain the pre-retirement lifestyle for many people.

Fortunately, the retirement income picture involves more than just savings. Social Security Benefits can provide a steady income stream, and part-time work or renting property can supplement your retirement funds. The average Social Security benefit is about $1,827 per month, up to about $22,000 per year. Combine that with the $20,000 in your savings and you have about $42,000 annually. This can help cover basic living expenses, but it can still be tight for some.

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Interestingly, according to a Go Banking Rates survey, nearly 40% of Americans think they can retire comfortably on $500,000 or less. While it’s possible for some, it’s important to have a realistic retirement plan. If you look for a more luxurious lifestyleyou will probably need to save more.

Whether you’re just starting your savings journey or on your way to $500,000, every dollar counts. Contributing regularly to retirement accounts, taking advantage of employer matches, and exploring other investment options can make a big difference.

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And for those who have already reached the half-million dollar mark, congratulations! You are in elite company. But remember, retirement is a long road. Keep saving, investing wisely and planning for the future.

The end result? Saving for retirement takes time and discipline. Understanding your financial goals and taking proactive steps can increase your chances of enjoying a comfortable retirement.

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